As reported earlier, BMO Capital analyst M. Ian Somaiya downgraded Tetraphase to Market Perform from Outperform and slashed his price target to $2.75 from $24. Somaiya points to the failure of the IGNITE3 Phase 3 trial on the company's lead drug, eravacycline, for complicated UTI, adding that the lack of insight into reasons for the trial's failure and more limited opportunity in cIAI could keep shares range bound.

02/14/18

STFL

02/14/18NO CHANGETarget $6STFLBuy

Tetraphase still has path forward for eravacycline, says Stifel

Stifel analyst Stephen Willey said the failure of Tetraphase's Phase 3 IGNITE3 trial in complicated urinary tract infection patients meaningfully alters the peak addressable market opportunity for eravacycline, decreases confidence in management's ability to successfully move earlier-stage pipeline assets to market, eliminates any longer-term optionality around a potentially-viable oral version and increases long-term financing concerns. With all of that said, he cut his price target on Tetraphase to $6 from $13, though he keeps a Buy rating on the stock, as he is still confident in the regulatory paths forward for eravacycline in complicated intra-abdominal infections. In pre-market trading, Tetraphase is down $2.68, or 49%, to $2.75 per share.

Piper Jaffray analyst Edward Tenthoff said the FDA accepted Tetraphase's NDA filing for eravacycline in complicated Intra-Abdominal Infections and set an August 28 PDUFA date with a 6-month priority review period. Tenthoff expects U.S. and European approval this year with commercial launches next year. Additionally, Tetraphase entered into a licensing agreement with Everest Medicines to commercialize eravacycline in Asia, which Tenthoff believes may expand commercial value for eravacycline in that market based on recent China FDA regulatory reforms. Piper reiterated an Overweight rating and $8 price target on Tetraphase shares.